We know times are tough for retailers across the US. Whether it’s trying to figure out how to keep consumers engaged or trying to keep costs low, everyone is trying to stay ahead in light of increasing pressures from inflation.
For MyTheresa, the German e-commerce luxury brand that has only been in the US since June 2021, the retailer has been up against pretty much the same pressures—but has seemingly survived.
At Retail Brew’s recent The Checkout event, Heather Kaminetsky, president of North America at MyTheresa, told us about the unique strategies and approach that has helped the brand stay afloat with increasing competition from the likes of Ssense and Farfetch.
For starters, she said, MyTheresa’s customers are unique in their shopping habits. “Our customers shop continuously, sometimes every day, but definitely monthly,” she said. “They’re always looking for a full wardrobe. One of the special things about MyTheresa is that we focus on wardrobe builders; it’s not just a consumer that’s looking for a bag or shoes once a year, but somebody who’s looking for ready to wear clothing—with the bag and shoes and the jewelry.”
There’s no place like…Arkansas: And these consumers, with their own set of priorities and spending patterns, exist not just in the major shopping hubs like New York and Los Angeles but also unsuspecting places like Arkansas and North Carolina, where Kaminetsky said the brand has customer pockets.
To reach them, MyTheresa has developed partnerships with clients in these markets and is also doing activations. “Our personal shopping team will identify [if] we have a client in North Carolina who would love to do a style suite or a pop-up with us, and then we’ll go into those markets,” she told us. “The beauty of what we’ve been doing is when we go into a market where we have an existing client, we will have them come and then we’ll ask them to bring their friends…Sometimes people ask for a plus-20. So it’ll become a shopping gala.”
And while in-person events have certainly helped MyTheresa broaden its reach, as an e-commerce brand, it is still more limited than retailers with physical stores. To combat this, Kaminetsky said the retailer has tried to “cultivate community” through physical shopping experiences and pop-ups.
“I think what we’re hearing is why people love to go physically into places because they want to connect, so while we don’t have a physical brick store all the time, we do a tremendous amount of activities with consumers in order to connect with them,” she explained. “I totally appreciate that shopping could be an activity, so there are many times we’ll do what we refer to as style suites within people’s homes, or within hotels, resorts.”
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Cheap thrills: But beyond tapping into different consumer bases and physical retail, a bigger challenge for MyTheresa has been the collective discount spiral that luxury brands seemed to have plunged into in the past year. Luxury sales have become commonplace for many luxury e-commerce brands, but MyTheresa has somewhat stayed away from deep discounting, only offering occasional promotional sales.
“For us, it’s very important to protect our relationships with the brands,” Kaminetsky said. “There is a schedule that’s released around when you can go on sale, and we stuck with our original schedule, which is seasonal, so we didn’t really break sale until late November while everyone else was doing discount.”
She added that while the retailer “lost some revenue to promotional activities that were happening within the market,” it has helped the company maintain long-term relationships with brands. “You need the margin, and it’s really hard,” she said. “I don’t judge anybody for what they do. But for us, we just avoid going down that competitive discounting landscape because it never ends. The clients really respected us for it, even though we probably lost some revenue at the beginning of the season when people were discounting everywhere.”
Of course, that also means losing out on a potential aspirational customer whose only access to luxury may be through discounted items, something many other retailers seemed to be banking on. But MyTheresa is not deterred in its primary goal.
“There are customers that would buy one bag a season or one pair of shoes a season; they look for more of a discount,” Kaminetsky said. “They probably went where they could find a discount, so in some regards, I’m sure that hurt us. But at the end of the day, our core consumer is not constantly looking for discounts. So the value of the consumers that we’re acquiring is greater for the long term.”